Technological innovation around energy efficiency and sourcing renewable energy are enabling significant sustainability gains in the real estate sector. At the same time, consumer demand and new local regulations put more stringent requirements on the sector to reduce emissions and waste–causing asset owners with billions on the line to set and meet increasingly higher goals in concert with builders, building managers, and even tenants on sustainability.

In this episode, Cass McFadden, Global Head of Sustainability at Cortland, discusses the spectrum of real estate challenges – notably those arising when a company doesn’t own the properties it manages – and shares accomplishments and experiences from her previous role at Bozzuto Group, where she was working at the time of this conversation. She explains sustainability concerns in multi-family structures, newly-minted single homes, and retail space managed by her firm. Listen in to hear McFadden discuss both progress and areas needing improvement in this compelling conversation.

Key Takeaways:

• Renewable energy procurement is rising in property portfolios despite market volatility.
• Energy efficiency measures often degrade over time, so it’s critical for property managers to keep up with innovation and regulatory changes. Property managers are the ones who must bridge the gap between stakeholders’ climate goals and resident comfort and satisfaction.
• The right technology solutions translate into significant financial savings for asset owners and residents alike.

Transcript

Dana Dohse: On this episode of the Decarbonization Race…

Cass McFadden: I think as a practitioner you have to look at opportunities to really educate, look at where owners are realistically in their ownership journey, and is there a way to communicate that there is a very seamless opportunity.

Dana Dohse: Cass McFadden, global head of sustainability for Cortland and owner and manager of apartment communities in the United States and the United Kingdom, joins host Lincoln Payton for a discussion on what the current state of play for sustainability is in the multifamily housing sector. Recorded just before Cass’ change in role, Lincoln and Cass dive into her previous role at Bozzuto Group and what privately owned corporations like Bozzuto can do at properties they manage to create or support sustainability initiatives that will impact generations to come. Ready to lead the sustainability pack, this is the Decarbonization Race.

Lincoln Payton: Well, hello everybody. Lincoln Payton here with the next edition of the Decarbonization Race, and I’m delighted to have with me Cass McFadden. Cass, good morning.

Cass McFadden: Hi, good morning. Thanks for having me, Lincoln.

Lincoln Payton: It’s great to have you here. And whereabouts in the world are you, Cass?

Cass McFadden: I’m at home in Virginia, recording live from here.

Lincoln Payton: Fantastic. And is that the part of the world you’ve grown up in and spent most of your life?

Cass McFadden: I haven’t. I actually grew up in Guam, and so that was a big part of my getting into sustainability and climate work. So happy to talk more about that in a bit, but for those out there who are from Guam who might be listening, hello.

Lincoln Payton: Oh, fantastic. Look, my dad flew during the second World War, and of course Guam’s famous for its base there, and I know he flew many times through that part of the world, obviously from the other side of the Atlantic originally, but that’s a very interesting one. Well, beautiful place as well. Let’s switch to nearer times. Bozzuto, very big footprint entity, lot of people don’t know them very well though. Who is Bozzuto? What is Bozzuto, what are they doing?

Cass McFadden: Absolutely. Bozzuto Group is a national private real estate company with four divisions. It’s got the management, construction, development and homes divisions, and the company has developed, acquired and built more than 45,000 homes and apartments. Currently, Bozzuto is managing more than 80,000 apartments and about 3 million square feet of retail, so to your point, no small footprint there. And of course it’s a national company, a really exciting development now reaching into California, so really bringing that national presence and the Bozzuto feel of putting people first and putting residents first, so that’s really exciting.

Given the company’s activities and reach, Bozzuto is really highly focused on minimizing its environmental impact, and so it’s been really exciting to watch everything that the company does to really promote healthy environments, to create sanctuary for its residents. And that extends through all of its activities, and the company is only getting better at that over time in close collaboration with other multifamily owners and all of its stakeholders. So great company, great people, and it’s really exciting to be with Bozzuto to do this work.

Lincoln Payton: No, it’s very cool indeed, and maybe that’s where we’ll go, which is how you came there. But particularly interesting, I think we’ll drill down in a second on how you get that message out because when you’re talking multifamily, it’s very different to the large, commercial office building industrial space. It’s a very different messaging to your client base if you like, or your primary client base, so that’s quite exciting. But what’s the path that brought you to Bozzuto and exactly what are you charged with there?

Cass McFadden: I will for a second take you down history lane, reflect on my past. We talked a little about Guam. It did have a role in World War II, but for listeners who may not know, Guam is a U.S. territory in Micronesia, so in the Western Pacific, and there I personally developed very early affinity for the tropical beaches, as you can imagine, and all of the natural surroundings. But early on, my family and I, we also experienced the very devastating effects of typhoons. They have the same weather phenomenon and structure as hurricanes, so well before attending middle school, I was very accustomed to or attuned to being in the path of a climate event and living without electricity and having low to no water pressure, et cetera for extended periods of time. So back then, we really relied on the support of the Navy and FEMA and the EPA’s guidance to get back up and running.

And all of those core memories really began colliding with a time when global warming and climate change were really gaining currency as a phenomenon, and by extension, shaped my decisions around academic studies and early career decisions. So I worked early on in regulatory positions doing consulting for energy in the environment, spent a lot of time with an energy supplier and the utility, and now I’m very deep in this multifamily, what we call sustainability work. And you can imagine all throughout that time, sustainability was like a curse word to corporate America. So here I am in multi-family, I spent some time with AvalonBay, which is a public real estate investment trust, and I’m now at Bozzuto. And so as I think about the experiences in these spaces, two different companies similar in terms of where they are in the markets that they serve, but two different companies, one being public, which is AvalonBay, one being private, which is Bozzuto, and you’ve got a different presence in the marketplace.

AvalonBay owns its assets and by virtue of financial and operative control, that looks very different versus at Bozzuto, where we have a lot of great stakeholders, different multifamily owners, but they all have their different charges or approaches to sustainability and to climate work. And so at Bozzuto, my day-to-day really involves the entire gamut of what you could even imagine under sustainability, whether it’s helping to do carbon planning, net zero planning, to EV charging, the energy efficiency upgrades and just trying to get oriented to where you need to get started if you’re at the outset at your asset. So that’s the day-to-day, and since I joined Bozzuto back in 2021, we’ve really pushed forward on stronger advisory in energy procurement, energy modeling, really understanding what the regulatory arenas are doing, what other multifamily owners are doing to not only get their assets ahead for compliance sake, but to really translate this into the residential experience and the bottom line in the long-term.

Lincoln Payton: Couple of points you made there. So you’ve clearly got a very broad remit here in terms of the genuine breadth of the VP sustainability. When you took over at such a large enterprise, how did you set priorities first, and fundamentally, what were they?

Cass McFadden: So there are three things that I looked at very quickly. First, I came from this utilities discipline at AvalonBay where we had a deep understanding of our data so that we could operationalize that, understand where the opportunities were and really mobilize on those pieces. And so that was really no different for me as I translated over to Bozzuto, to really take a look at where these assets lied and where they were performing. If there was low-hanging fruit in any of the performance metrics related to utilities, then those are areas that we tried to tackle early on. High energy consumption in either electric or gas, or you see that there might be a variance in water consumption, you want to look at those opportunities there and say, “Okay, well maybe there’s some opportunity to integrate tech or integrate a new solution that would bring that down,” because that automatically translates to benefits for the asset owner, but could also translate to benefits for the residents.

And so those are areas that we tried to look at, as well as waste opportunities. I think there are a ton of diversion and recycling opportunities across jurisdictions, but over time you have to make sure that you’re paying attention to the ongoing configuration, residential engagement as everyone’s starting to mix everything together and now you’ve got these skyrocketing costs that from an owner’s perspective really get in the way of other investments, not only in their broader portfolio but at the asset itself. So we looked at those types of opportunities, that’s just the utilities discipline component, but at Bozzuto it was taking a look at what the priorities were for each owner. There are a group of owners who are very aggressive about their sustainability targets and want to go all in on climate mitigation and really assessing the risk and coming up with plans, day-to-day operational procedures to attack the climate risk, whereas others may still have questions about what is renewable energy procurement and why should we lock in at a specific time?

So that was the second piece, really understanding where they were, and then I think as a practitioner, you have to look at opportunities to really educate. Look at where owners are realistically in their ownership journey and say, “What are their fears? What are they worried about in terms of making financial investments, making programmatic investments, and is there a way to communicate that there’s a very seamless opportunity?” Whether it’s just tracking your data better or whether it’s understanding that a renewable energy procurement, you could green your load and not lose out on money and gain some budget in the process. So I think that was another piece, and then finally I would say I really wanted to know early on when I first joined Bozzuto what the appetite was internally to move on these pieces. You need collaboration, you need interdepartmental support, and I found that it was there. Whether through our SVPs or regionals or even onsite property managers, they have an appetite to learn and to really action these pieces all the way through to residents.

Lincoln Payton: Look, very good, and I know it’s gone well, so congratulations. Again, picking up on something you said there, which was certainly inside Bozzuto you had a positive reception, people were interested, and let’s all be honest, big organizations getting buy-in is always part of the challenge. Take that to the owners themselves. And in a way, you’re in a very interesting market survey reception type of role because range of owners that you’re servicing. How was their reaction? Was it universally, “Yes, this is good to be doing. We are willing to spend more time and more money,” because invariably, there is an element of more money, or were there some that would push back? Were there some that were, “Well, show me the compliance rationale, and if there isn’t one then maybe I won’t do it yet?” What was the range of reaction you got and how did you handle that?

Cass McFadden: I want to take the opportunity here to bring up a really concrete example of major opportunities to collaborate and talk about a new compliance piece. So for DC, we had the building energy performance standards that were really put in place and action, and Bozzuto’s role in that, we’re not the owner so we’re not completely creating the compliance pathways, but we understood as a property manager that we had to step in and be proactive about letting our owners know what is the timeline. What does this compliance piece actually mean? How much do you have to reduce your consumption, buy-in by what time, et cetera? So you have all of these logistics to it, and terms of communicating that out to owners that were jurisdiction only relevant, many of them were like, “Okay. Well, we kind of don’t understand this timeline. What does this mean? What is the trigger? Our score and Energy Star portfolio manager, is that the only trigger or is it something else?”

But there are all these technical components, and so some owners were very quick to say, “Let’s get an audit in place. Let’s understand what we need to do at this property so that we can come up with a plan.” Others, it took a lot of time. They had questions about, “Is our data clean? Do we understand that this is actually our score? Why should we pay $15,000 to $25,000 for an audit if we can just look at the data and at the base level understand where the issue is? Shouldn’t we just be able to decide what technological advances we want to integrate here?” But as part of that compliance feature, folks knew the audit had to happen. So that’s just one example, one compliance tool to really demonstrate how you can have varying responses to this, and it does depend on the ownership approach to sustainability, what plan they have in place.

And so if that compliance and benchmarking and whatever else it might be, if that piece is something that is centrally understood by their organization, they’ll move on it pretty quickly, and they’re probably networked to a degree where they understood that it was coming or they might have heard it from us. But for others who might have just joined our property management platform or who may have not been totally bought into the sustainability or ESG picture, it does take a little more hand holding, and for them it takes the sound bites to really spring them into action. The sound bites of, “We will help you because we’re trying to help you avoid a $7 million fine.” Then the ears perk up and say, “Okay, I understand that there are real teeth to this thing.”

So that’s just one example, and another easy one that I want to throw out is renewable energy procurement. With rates on electric and gas, we’ve really seen a lot of volatility, especially given the environment of the last few years. We’ve had a pandemic and we have an ongoing war. We’ve seen a lot of legislative and almost political influence on where rates and pricing may be going. So there are some owners that say, “Well, I just want to wait. I don’t want to procure, I want to wait a few months to see how it pans out.” And as a practitioner, you constantly inform them that the ebbs and flows that we used to see in the market may not apply right now, so let me help you with this, that and the other. So it’s been interesting, you see a wide range of emotions and response when it comes to this field.

Lincoln Payton: On the green energy procurement, what’s the percentage success rate you have an encouraging owners to procure green energy for their buildings?

Cass McFadden: We’ve quantified in the last year, probably a month shy of a year, that we’ve been able to help owners push the total load to the renewable side by 6%, so it equates to 6 megawatt-hours as compared to the entire procurement portfolio. That’s quite the success. It is different from my experience when I was at AvalonBay. We had a total renewable energy procurement strategy as part of the broader science-based targets, and so every single procurement activity we had, we pursued. Renewable energy credits, for example. On this side, every expiration of contract starts the conversation over, and so going into that with the owners and really talking through let’s refresh pricing, let’s take the next step, and prices don’t hold. They can change every single day, and so if we’re not in close communication with owners because they’re handling a million other things, then that sometimes can fall through, which is a challenge.

But I think that 6% increase is something we take as a major win, especially as Bozzuto is signed onto an RE100 commitment. We’ve just finished our first climate disclosures, and so that is something that we very proudly noted, that through our advisory we are increasing the renewable energy procurement. We have a program that we kicked off this year that we’re also very proud of. It’s in partnership with Arcadia and it’s the opportunity for our residents who historically and traditionally have not had access to renewable energy in multi-family properties for them to sign on to community solar programs. And so we love that from an ESG perspective, we’re not only bringing more renewable energy sort of online and into our communities, but also providing the associated financial benefits to our residents, which is resulting in savings on their electricity expense. So right now we’re looking to quantify that amount in terms of the load conversion as well, so that’ll be another win not only for Bozzuto Company but for all of our stakeholders.

Lincoln Payton: So drilling into that type of situation, because again, you’re in a very interesting position because you’re genuinely getting market feedback at the sharp end of the pencil, if you looked across your different regions, and you’re geographically quite spread and diversified, when you are advising users to switch to renewable energy, is it resulting in higher cost in today’s environment? Because we’ve obviously got higher costs in the hydrocarbon elements of energy, is it easily available to find renewable energy, green energy that they can purchase distinctly, and is it costing them a premium?

Cass McFadden: Right. So my answer earlier this year versus after March or April of this year, totally distinct or very different. Earlier in the year, it was not costing a premium. It was either the same rate as a standard offering or sometimes a little lower, like 0.01, 0.02 cents cheaper per kilowatt hour, for example. Now we’re seeing that the prices are either keeping pace or that REC component for example on an electricity contract is a little higher. And so the conversation then becomes for the owner, “What is your sustainability strategy? What is your plan? Is this actually material to you? Because if it’s material to your strategy, then you now have to make a decision. We quantified the additional cost for you, you now have to make a decision as to whether it’s worth it for you in your portfolio.”

So we’ve gone about it in that way with our conversations while also messaging the broader commitment that Bozzuto has to renewable energy and the RE 100, like I said, and the climate disclosures. So it is a little tricky. When the majority of your portfolio is third party managed and you don’t have total financial and operational control, the alignment of values, the alignment of the approach becomes extremely critical, but all of that to say at the end of the day, we understand it’s an advisory function. And so if owners do decide to pivot or maybe they want to put more energy, no pun intended, but more energy into their energy modeling or some other component of their strategy, then we help to facilitate that.

Lincoln Payton: You’re genuinely fulfilling a comprehensive advisory role and going with the direction they want to. Another element you mentioned there, and just I think it’s interesting to drill into, RECs, the offset market, the renewable energy credit. What is the balance of comprehension and interest that you’re seeing from this same stakeholder group, which is a very informed and relevant stakeholder group, across frankly just doing nothing? Taking energy from the grid if you like, going out and actually procuring green energy supply physically whatever route that may be, which is rooftop solar community, solar PPA, whatever it might be, and then the REC market. What is the comprehension amongst your informed grouping there and what is the direction that they’re moving?

Cass McFadden: Right now, I think the comprehension is that you can interact with RECs in different ways. And so the easiest way is to think about the energy procurement piece and that you could, for example, now completely green your supply 100% RECs, whatever that price may be. That’s one step. The other one is we have several owners who are thinking through solar installations right now and going back and forth because obviously the market, I don’t want to say it’s in turmoil, it’s moving, so they’re thinking through what these solar installations can mean long-term, interacting with that long-term electricity bill. They’re very interested in whether or not they can own the RECs from these projects, just because the value of them is changing over time. 

And they understand that the reason why it’s changing over time is because now you have all of these companies who are moving very quickly on their climate commitments, and quite frankly, the easiest tools other than deeply decarbonizing or changing your energy modeling, et cetera, which often requires very intensive capital investments, is to figure out that complimentary piece and say, “This is what we’re trying to offset. Let’s go purchase those RECs that they do have an expiry date, but they help you facilitate your strategy for some theory that time, especially if it’s cost-effective, and that helps you handle part of your approach.” So they understand the diversity in how RECs can be treated, how they can be monetized or retired over time. 

And just depending on how long their strategy might be, some are attacking things in five years, others in 10 to 20 years, and so the companies and especially public ones who have the longer term commitments, they might say, “Well, let’s make the upfront investments. Let’s maybe even create or develop or construct our net zero buildings and change the current makeup of our assets, and if we’re going to purchase RECs en masse, let’s do that in years eight through 10 or whatever it might be. Let’s see how much we can do up front before we just go purchasing something that really isn’t fixing the long-term problem.” It is facilitating the demand, more renewables to come online, but it’s not deeply decarbonizing the portfolio so to speak.

Lincoln Payton: So there is an awareness that there is that difference that arbitrage between a REC and actual green supplier. Very interesting topic there. You talked about energy efficiency, and we’re talking here about getting to net zeros and targeting. In advising and instituting policies, I often think of it in the three big categories for real estate. One is you can make your buildings more efficient, windows, lights, insulation, all of these things. Second one is human behaviors. You can adjust thermostats, you can live with demand response, you can be willing to be flexible at certain times. And then the third one is the nature of the energy that you’re actually using in your buildings. If you take over a new building or portfolio, how do you approach that from the beginning in terms of what’s the best we can do and some of that low-hanging fruit you mentioned earlier on?

Cass McFadden: One thing that we’ve been doing at Bozzuto is integrating more of the sustainability conversation even into client pitches at the outset. Bozzuto very much wants all of these activities to be at the forefront and to be part of its identity to say that we have the partnerships or the capability to attack all of these pillars, whether it’s the building component, the people component, the actual profile of your energy, et cetera. So all of these are on the menu. To some degree it’s a la carte by ownership, not necessarily because we’d want it to be, but because quite frankly, some of them are maybe a little more ahead in some categories. We could have owners come to us and say, “We have these fantastic assets that we were so serious at the outset. We’ve done everything, sit well, lead integrations. The building is sound, we need our residents to get on board.”

And Bozzuto will say, “Well, we have some of these programs that can really help to facilitate the awareness and engage your residents, so we’ll help you take you to the next level.” So all of these components are important. I think there are very clear challenges in each category that we’re always reckoning with in multifamily and just as sustainability practitioner. So when you’re thinking of building efficiency, it’s the rule of no matter how many new things you latch onto the building, no matter how many times you’ve redone it, it is always sort of degrading over time. The efficiencies that you are gaining are always coming down over time. And so figuring out how to keep pace with innovations that are out there plus the teeth of the regulatory market and what’s being really demanded of these buildings in terms of their performance is an area of challenge.

And when it comes to the residential engagement, whether you’re a homeowner or a renter, everyone has a similar sentiment when it comes to your home. This is my home, I want to operate the way that I want to operate. And so I’ve seen multifamily owners move forward in let’s say green leasing, trying to get residents to buy in early on in a written commitment type of way to maybe certain sustainable products or behaviors, and they’re finding varying success with that. Sometimes residents move in because that’s their personal identity and they’re completely bought in, whereas others, they come into the understanding later on and suddenly there’s a question of why do I need to do this or that, or why is maintenance coming into my unit so many times to maybe change something to low-flow or whatever it is. 

So there’s that component as well, and then I think this final piece of the profile, the energy profile going into a building. I think we can all agree when you switch a light on or off, you don’t really know what’s behind it and you don’t care. You care that the light comes on. So really integrating that component, taking this regulatory environment to the next step, saying first we were trying to reduce consumption, now we actually care about what you’re consuming, it’s a different kind of push. And Boston is a great example where I’ve seen BERDO 2.0 come out, asking questions about what are you procuring? Give us your contracts and let us take a look at that. That’s just an example of how the entire environment is moving to get to that next step.

Dana Dohse: Cass just mentioned BERDO. That’s Boston’s Building Emissions Reduction and Disclosure Ordinance, more recently referred to as BERDO 2.0. This legislation is part of a new wave of city and state laws mandating businesses to reduce and report on their carbon footprint, and by extension, their energy sourcing. Similar legislation has gone into place elsewhere in the United States, like New York City’s Local Law 97 and Maryland’s Climate Solutions Now Act of 2022, and there’s national legislation at play here too. The recent passage of the Inflation Reduction Act, along with new incremental funding support and incentives, are all working together to drive building decarbonization as well. As companies continue to focus on ways they can reduce their carbon footprint, eyes are on the building sector to decarbonize. For more on this trend, click on the link in the show notes.

Lincoln Payton: How do you manage the internal PR, if you like? Because when you’re dealing with multifamily units, it’s a different story. You mentioned maintenance coming around regularly. When it’s a commercial office building or an industrial park, very different. You go to the person who’s responsible for the premises and you clear everything, and then you get on with what’s got to be done. Very different when you’re talking multifamily housing. Do you have some formula for doing that?

Cass McFadden: That’s where our team at Bozzuto really makes a difference, whether it’s property managers onsite, or maybe he’s got regionals and others internally who are making their rounds and visiting the different apartments to keep the communication flowing and keep strong relationships. Just across the board, we’ve got our marketing teams, our comms teams who are on board every single time we want to roll out an initiative or talk about the world of good that it’s done afterwards. We’re really working hand in hand to bring that story together and to communicate the benefits, and so I think that’s especially important.

You bring in other importance actors in multi-family, you think about the diversity in your stakeholders. Whether it’s at the residential level or the associate level, it’s really important to keep communication and trust-building at the center, otherwise it is very difficult to layer some technical aspects on top of that. “Oh, we’re doing something new,” or, “We’re changing something out, we’ve got to come in your unit,” or, “We might be changing costs.” All of that messaging can be very stressful for residents especially, and you think through coming out of a pandemic and dealing with all of these macroeconomic factors right now, there’s a lot of sensitivity that’s needed when communicating change.

Lincoln Payton: It’s an area where you excel, you’re doing very well, so congratulations on that. Just before we go to the regulatory side of things, which I think is interesting and I’m interested in how you see the future coming, but on the various ratings for building, we have historical processes for evaluating buildings. How do you think about that world and how do you employ it or manage it? What’s your perception of the real estate rating story?

Cass McFadden: I think there are so many tools and certifications, and we get this question all the time from owners, “If you could give us our perfect certification or ratings package, what would it look like?” I talk about two things. It’s really the physical makeup of a building, what’s going to guide that, what’s going to be your true north? And this is based on maybe where they’re jurisdictionally located, where their closest peers are operating, so a lot of it is guided by that. And so in terms of selecting lead or maybe some other certifications that are out there, we ask them to just have a true north. And then there is this growing physical wellbeing residential component. So you think of Fitwel. That’s really tied to CDP, it’s tied to health standards, and that becomes really important because that’s all part of the residential experience.

There are other data points to prove that if you’re Fitwel certified, that folks will pay a higher premium. And I think that’s a really important point for a lot of owners, but ultimately it’s figuring out that perfect package of how do you get your asset to perform at a certain level so that it’s not too far from where the regulatory environment wants you to be. Ultimately, that’s a huge piece for investors, whether you’re a public or private company. They’re looking at where that gap might be as well as making it a positive experience or positively tied to residential satisfaction, and so really, that’s how we look at that component.

Lincoln Payton: Let’s look forward now, regulatory-wise. What do you expect to happen? We’ve got the pockets of existing regulation, Local Law 97 and you mentioned BERDO, what do you see coming in terms of the implementation of those initiatives and regulations? Because there are those that say very good, it’s moving things in the right direction, there are those that say frankly, the pressure group pushback is going to water those down by the time they become implemented, and then there are other states that are working on similar regulations. Coming from the Cleartrace point of view, we like to see the trend going in the direction of clear parameters for behaviors that then can lead to hurtling to taxing, to cost element there because it’s what genuinely moves things in that direction and it uses a more specific data set. But what do you see? Do you see the regulatory world tightening or staying where it is?

Cass McFadden: I think we have some clear indications that it’s tightening. We briefly touched on the drive towards reducing consumption across buildings period, and now we’re seeing the second step just in terms of the energy profile, but there’s no indication that this is slowing down. And understandably, interests are in different areas and I think in the broader ESG picture, there are questions about the validity, the legitimacy of driving deeper into these commitments and these investments. But ultimately, the teeth that we see in the market indicate that it’s only becoming more stringent. More and more companies need to really get a clear understanding of their data no matter what their model is. Whether you have total financial or operational control or not, you need to get some sense of it and figure out the materiality to your business, how to scope that and how to really approach the sense of obligation in these areas.

Back when I was with WGL Energy, which is an energy supplier, what I understood about the regulatory arena and that it does its very deep due diligence working with different companies and different stakeholders, and I continue to see those patterns as I stay up-to-date with my industry colleagues and my networks. They’re continuing to refine what’s already in place right now. They’re not unraveling it, they’re trying to figure out there’s an Energy Star score somewhere. How do we make it make more sense? How does that algorithm make sense? If folks are putting in more vehicle infrastructure, for example, and it’s tying back to their larger consumption, how do you come up with rules to kind of keep that scoped out, et cetera?

So they’re refining all of these approaches. And I’m sure, Lincoln, you might have seen this as well as we talk about the different scopes of emissions, et cetera, folks joke that we’re going to get up to scope 10 and how can you possibly do that? But everything is just getting more and more refined over time. There was some sort of market consensus that has happened at a certain point that really established the need to move in this direction. And so the pace is in question right now, but I think ultimately it becomes more serious and more refined over time, asking the deeper questions like how does this impact maybe bigger multifamily owners versus the smaller ones that are just coming into the arena? So we’re looking for nuances at this point, maybe not a complete undoing.

Lincoln Payton: I do fully agree with you, and again, I think of it in progression, which is we’ve gone from recognizing there’s an issue to talking and trying to address the issue, and now we’re in that we’ll verify, analyze, measure, and manage the issue. It’ll be interesting the timeline, and I think we’ll see that in the coming couple of years to see how quickly those things change. So what do you see in your world 20 years from now in terms of the multifamily real estate management? What does it look like? What are the elements that you hope are there and what are the elements that you definitely think will be there?

Cass McFadden: As someone who has grown up in this space, understanding different sides of it, studying policy and the technical aspects of energy, et cetera. And yes, now raising kids, one who is almost eight and one who just turned five, I would love for the practical aspects of sustainability to really be normalized. And again, growing up it was a curse word in corporate America. Looking at the business components, looking at all of the opportunities there are, especially with innovation, I think there’s a real opportunity to take the lessons learned to understand the parts that can be not only good for business, but good for people and their health and wellbeing, good for the environment, which really loops back to public health and to integrate that as being very normal. 

I couldn’t tell you if all the cars are going to be electric vehicles, I couldn’t tell you if all of the infrastructure will be solar integration and every single resident, whether single family, multifamily, commercial will be completely bought in, but I do think if you normalize the integration of these things, it’s very easy for people to not have to think twice about it. To maybe necessarily think twice about product selection or just choices that they make around different energy sources and whatever it is. And folks have so much to deal with on a daily basis, so much to think about with families and friends and careers and every decision that they make every day, and so if you can really make it more natural for them to live this way in a way that’s also beneficial to them, I would love to see the world go in that direction.

Lincoln Payton: I think it’s a great vision, and I’ll say thank you very much for your time today. Congratulations on what you’re doing at Bozzuto and explaining it so well. It seems a very practical approach to life. But Cass McFadden, it was really great to talk to you today, and thank you very much.

Cass McFadden: Thank you so much, Lincoln. 

Dana Dohse: Thank you for joining us on the Decarbonization Race. For more resources to help you lead the pack in the most important race of our lifetime, visit cleartrace.io/podcast.